If you were due to make a VAT payment between 20th March 2020 and 30th June 2020, that payment won’t be collected. You must still file your VAT returns on time so that HMRC can see how much it can expect to collect once the deferral period ends, but you won’t have to pay any VAT.
This is an automatic extension, so you don’t need to apply for it. However, if you pay VAT by direct debit, you should cancel the direct debit if you wish to take advantage of the deferral. HMRC will not cancel your direct debit if you wish to continue making payments.
HMRC’s guidance currently says that taxpayers will be given until the end of the 2020-2021 tax year (i.e. 5th April 2021) to “pay any liabilities that have accumulated during the deferral period”.
However, the Chancellor’s statement on Friday referred to the deferral of payments until the end of the financial year (i.e. 31st March 2021). We’ll provide an update when the deadline for making deferred payments has been clarified.
If you were due to receive a VAT refund during the payment deferral period then don’t worry, you will still receive it within the normal timeframe.
Self Assessment payments to be deferred
If you were due to make a payment on account on 31st July 2020, you won’t have to make that payment until 31st January 2021 and HMRC won’t charge penalties or interest for late payment. This is another automatic extension so you don’t have to apply for it.
Universal Credit for self-employed people
From 6th April 2020 sole traders and partners – who won’t benefit from the Statutory Sick Pay (SSP) reclaim announced in the Budget earlier this month – will be able to access Universal Credit at £94.25 per week, a rate equivalent to SSP. There’s more information about how to claim this on the government’s Universal Credit website.